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Consumer prices in Brazil rose less than expected in the 12 months through October 2026 but remained above the central bank's target range, statistics agency IBGE said on 12 November. Annual inflation reached 4.63 percent last month, up from 4.58 percent in September but below the 4.73 percent expected by economists in a Reuters poll.
Consumer prices were up 0.14 percent in October, slowing from 0.82 percent in September, while economists had forecast a 0.25 percent rise. Monthly inflation was driven by higher food and beverage prices, up 1.04 percent, while transport costs fell 0.59 percent and housing costs eased 0.51 percent. The softer monthly reading gave some relief, but the annual rate is still above the bank's goal.
Brazil's central bank targets annual inflation at 3 percent, plus or minus 1.5 percentage points, so the top of the range is 4.5 percent. At 4.63 percent, inflation sits just above that upper limit. Policymakers have vowed to keep using high interest rates to rein in persistent inflation, and the bank last week paused an easing cycle launched in March, holding its benchmark Selic rate at 13.75 percent.
The bank is grappling with a worsening inflation outlook, and economists say the October figures will not change its cautious stance in the near term. Food prices remain the main upward pressure on household budgets, while lower transport and housing costs helped to hold the monthly figure down. The central bank watches both the annual rate and the monthly movement when it decides whether to change borrowing costs.
For readers in Britain, Brazil's experience is a reminder of how food and energy prices shape inflation in large economies far beyond Europe. The country's inflation rate has stayed above target for much of the year, and the central bank's next decision will be watched closely by markets. The full October data were released by IBGE, Brazil's national statistics agency, on Thursday 12 November.
Source: Reuters
